Leaders of major ITAD firm Ingram Micro have signaled their intent to list the company on the New York Stock Exchange, which would mark a return to publicly traded status after about eight years as a private company.
The Irvine, California-based electronics distribution company on Sept. 30 filed paperwork with the U.S. Securities and Exchange Commission, proposing an initial public offering of stock shares. The move comes almost exactly two years after the company took similar steps in October 2022. That plan was later abandoned.
In announcing the plan, an Ingram Micro spokesperson said the number of shares and price range for those shares has not yet been determined. Ingram Micro would be listed on the NYSE under the symbol “INGM,” according to the announcement.
As evidenced by the 2022 filing, the SEC paperwork doesn’t guarantee the company will go public. But if it goes forward, the move would create a major publicly traded ITAD firm in a sector with few public companies. Iron Mountain is a notable exception, and others include Envela, parent company to Echo Environmental, ITAD USA, Teladvance, CEX and Avail; and Sims Lifecycle Services, whose parent company Sims Limited is listed on the Australian stock exchange.
Ingram Micro was formerly a publicly traded company until 2016, when it was acquired by Chinese conglomerate HNA Group and taken off the NYSE. In 2021, Ingram Micro was acquired by Platinum Equity.
According to the SEC filing, Ingram Micro currently operates 134 logistics and service centers globally, and it manages more than 850 million units of equipment per year. With its core business in electronics distribution, ITAD makes up a small portion of the company’s activities. The SEC filing indicates ITAD, reverse logistics and repair services make up less than 10% of the company’s net sales.
Ingram Micro operates U.S. facilities performing ITAD, repair and refurbishment services in Chandler, Arizona; Fort Worth, Texas; Indianapolis; Las Vegas; and Plainfield, Indiana.
The SEC filing indicates Ingram Micro recorded $48.04 billion in total net sales in 2023, and $3.55 billion in gross profit. Those figures were down from $50.82 billion in sales and $3.69 billion in profit in 2022, and $54.46 billion in sales and $4.11 billion in profit in 2021.
In 2023, the company’s business division that includes ITAD, reverse logistics and repair reported $624 million in net sales.
Move could generate new capital for ITAD growth
Required disclosures by publicly traded ITAD firms provide valuable information to gauge the health of the industry. Quarterly reports from Iron Mountain, for example, provide a look at component price movement, data center refresh trends and general assessments of the ITAD market.
Beyond the valuable information Ingram Micro would be required to report, an IPO would likely raise significant capital for the company, said David Daoud, principal analyst at ITAD market research firm Compliance Standards, in a note to clients.
Daoud said there are too many unknowns to make a certain prediction about what the move means for Ingram Micro. For example, it’s hard to say what the company might do without knowing its full financial situation including debt load. But he suggested a few possible outcomes.
He pointed to the saga of Arrow Electronics, another publicly traded electronics distributor that grew in the ITAD space quickly and then suddenly left that industry altogether in 2019. When the company exited, one Arrow executive said the company “didn’t want to have a non-ancillary business around that wasn’t really driving the strategy and driving the future growth.”
That “potential for the ITAD unit to be completely disregarded if resources are allocated to core activities” is one consideration for a growing company that has an ITAD arm as a small portion of its overall activities, Daoud noted.
But another possibility is that the company takes the newly raised capital and injects it into the ITAD division. Daoud sees the potential for that outcome, noting that “with the market craving for data center decommissioning, a sustained refresh cycle, heighted demand for data security and ESG compliance and a global footprint, (Ingram Micro) is looking at how to play in those markets, in addition to its core business.”
“With the raising of cash from the IPO, Ingram Micro’s ITAD unit could benefit from that with an expansionary plan that some of its competitors have already started,” Daoud wrote.
Ingram Micro hinted at the value it sees in the ITAD sector in its IPO filing. The company cited figures from research firm IDC showing significant corporate spending on IT refreshes over the next three years, and data from research firms Technavio and Statista showing corresponding ITAD market growth.
“As IT spend continues to increase, we expect demand for IT asset disposition and reverse logistics and repair services to also increase,” Ingram Micro wrote. “We believe our differentiated capabilities enable us to continue our leadership position in this large and growing market.”
